Nebius Group’s Mushrooming Capex Overshadows Its Hypergrowth

Core Insights - Nebius Group (NASDAQ:NBIS) reported significant growth in its AI cloud operations, with Q4 revenue reaching $227.7 million, a 547% increase year-over-year, and full-year revenue of $529.8 million, up 479% from the previous year [2][4] - The company anticipates further acceleration in 2026, supported by strong customer contracts and infrastructure expansions [2] Financial Performance - Q4 revenue surged to $227.7 million, a remarkable increase from $35.2 million last year [4] - Full-year revenue for 2025 reached $529.8 million, up from $91.5 million a year ago [4] - Adjusted EBITDA turned positive at $15 million compared to a loss of $63.9 million a year earlier, although it fell short of the $22.55 million analyst consensus [5] - The net loss widened to $249.6 million in Q4 from $122.9 million, primarily due to increased operating expenses related to rapid scaling [5] Capital Expenditures and Future Guidance - Capital expenditures (capex) rose sharply to approximately $2.1 billion in Q4 from $416 million in the prior-year period, with full-year 2025 capex totaling $4.1 billion [6] - For 2026, Nebius plans to allocate between $16 billion to $20 billion for capex to support the rollout of nine new data centers and additional infrastructure [6][8] - Management indicated that around 60% of the 2026 capex would be financed through internal resources, with the remainder sourced from debt financing and potential asset sales [7] Future Projections - Nebius projects 2026 revenue to be between $3 billion and $3.4 billion, with EBITDA margins approaching 40% [8]